How to Become a Chief Executive Officer

How to Become a Chief Executive Officer: The Path to Top Leadership

Being appointed CEO represents a pinnacle leadership role. As chief executive, you steer the entire company towards strategic goals. This article explores typical steps to become a CEO along with key capabilities required.

Typical Career Pathway

While each leader’s journey is unique, common pathways exist for rising to CEO:

Gain broad functional expertise – Develop well-rounded experience spanning key business functions like operations, finance, sales and marketing early in your career.

Take on increased management responsibility – Progress from managing small teams to larger, more complex functions, divisions or regions. Gain general management skills.

Undertake special projects – Lead high-profile initiatives outside your core role to gain exposure and showcase abilities.

Obtain profit and loss responsibility – Manage a distinct business unit with its own P&L to demonstrate operational leadership.

Join the executive team – Gain broader organisational perspectives and visibility as an executive heading a function.

Become heir apparent – Earn appointment as President or Deputy CEO being groomed as the CEO successor.

Step up during transitions – Act as interim CEO during between permanent appointments to prove readiness.

Compete for CEO vacancy – Finally, compete against other highly qualified internal and external candidates when the top role is vacant.

Each prior role builds credentials ultimately positioning the leader as CEO material.

Should Prospective CEOs Explore Other Industries?

While internal promotion is common, aspirations may require exploring CEO opportunities across industries or sectors.

Leadership capabilities transfer, although some industry familiarity is beneficial. Transitions to lead regulated entities like banks or infrastructure require pertinent experience.

Chairing an industry association board, non-profit board directorships and special project roles can expand industry networks and knowledge. Secondments also build new sector expertise.

What Are the Leadership Capabilities of a CEO?

Beyond technical and management expertise, several vital leadership capabilities enable effective CEO performance:

Vision and strategy – Ability to set clear direction and inspire collective buy-in across the organisation. Also includes strategic agility to adapt to changing conditions.

Results focus – Drive to consistently achieve outcomes by setting high performance standards and accountability.

Communication – Connect across all levels of the organisation and externally using empathy, transparency and clarity.

People leadership – Motivate, develop and empower diverse talent and build capable leadership teams.

Innovation – Promote a culture of innovation and continuously improve through technology, processes and business models.

Stakeholder management – Balance interests of and develop trusted relationships with investors, communities, government and partners.

Risk management – Anticipate risks and ensure prudent policies and controls are in place to manage exposures.

Governance – Implement robust governance frameworks for ethical behavior and sound practices.

Conceptual thinking – Solve complex problems with creative solutions and long-term perspective.

These differentiating leadership capabilities complement crucial general management skills honed through diverse roles.

What Does A Board of Directors Look For in a CEO?

Boards seek well-rounded CEO candidates with a balance of leadership traits, management expertise and personal attributes. Common selection criteria include:

Demonstrated leadership record – Consistently delivering results in positions of increasing responsibility.

Strategic mindset – Ability to analyse the competitive landscape and chart a winning strategy.

Functional/technical mastery – Management credentials in functions relevant to the organisation’s business model.

People leadership – Engages, empowers and develops workforce capabilities at scale.

Governance track record – Commitment to ethics, compliance and serving stakeholders interests.

Change management – Ability to lead transformation and cultural alignment to strategy.

Communication skills – Articulates vision persuasively, listens actively.

Education and qualifications – Relevant degree and executive education to expand knowledge.

Boards conduct extensive due diligence to identify standout CEO candidates against criteria similar to the above.

How Do You Develop CEO Potential?

Upcoming leaders can proactively build CEO readiness through:

Broadening experience – Seek varied roles expanding functional diversity.

Building networks – Engage with directors, executives and mentors to grow visibility.

Undertaking training – Complete leadership programs and executive MBAs to augment skills.

Seeking exposure – Request involvement in high-level projects and strategy meetings.

Demonstrating potential – Consistently exceed expectations in current responsibilities.

Aligning conduct – Model leadership values like integrity, transparency and accountability.

Clarifying ambition – Privately discuss desire to be a CEO and seek honest feedback on gaps.

With commitment and perseverance, talented leaders can chart a path to the top over time.

Conclusion

The path to CEO has common stepping stones but requires well-rounded leadership capabilities and experiences. Boards have high expectations when selecting chief executives to successfully execute strategy. Beyond technical expertise, leadership traits like strategic thinking, communication skills and governance behaviors distinguish CEO caliber talent. Leaders who consistently build knowledge, deliver results and exemplify values while maintaining CEO ambitions position themselves to seize opportunities to reach the top role.